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Insurance provides financial loss protection. It is a type of risk management used primarily to prevent the risk of uncertain or contingent loss.
An insurer, insurance company, insurance carrier or underwriter is known to provide the insurance company. An insured or a policyholder is known as a person or entity buying insurance. The insurance transaction includes the insured person in exchange for the insurer's promise to redeem the insured in the event of a covered loss on guaranteed and relatively little known loss in the form of a payment to the insurer. The loss may be financial or not, but it must be reduced to financial terms and usually involves an assured interest, which is established through ownership , possession or pre-existing relationship.
The insured receives an insurance policy which details the terms and conditions under which the insurer will make up for the insured. The insurer's charge of the coverage of the insurance policy by the insurer is called the premium. If a loss is potentially covered under the insurance policy, the assured shall submit a claim for processing to the insurer through a claim adjuster. The insurer may take a reinsurance risk and other insurance companies agree to take certain risks , especially if the primary insuring company considers that the risk is too big for the insurer to bear.